The City should improve the efficiency and oversight of the City’s take-home vehicle practices.
The Department of Family and Community Services should identify internal controls needed to improve processes accountability and transparency pertaining to the operational activities of the department’s Health and Social Service Centers.
The City of Albuquerque and the Albuquerque Convention & Visitors Bureau should work together and improve the successful promotion of Albuquerque as a destination.
The Real Property Division should continue to refine existing standard operating procedures in order to continue providing quality professional real estate services to the City of Albuquerque.
The Information Technology Services Division should regularly review and update its Disaster Recovery planning documentation to enhance the division’s ability to ensure continuous service of critical IT components.
The Department of Senior Affairs Home Services Division can improve upon the valuable services it provides to the senior citizens of Albuquerque through improved activity tracking.
The Department of Finance and Administrative Services' Purchasing Division can improve upon the valuable services it provides to the City and contractors by acceptance and implementation of the following recommendations: (a) The Purchasing Division should require that City Departments attend contract training more frequently; (b) The Purchasing Division should review its internal control processes and ensure that all staff have a clear understanding; and (c) Employee access to CTS should be revoked following the employee’s change of employment.
The Classification and Compensation Division (CCD) and The Employment Division (ED) should monitor and improve key processes and actions, and develop key benchmarking metrics. The Human Resources Information System (HRIS) should be more fully utilized to collect, analyze, and track data, and enhance coordination with other City departments to address concerns and minimize inconsistencies.
At its August 19 meeting, the Albuquerque City Council appointed Debra Yoshimura Director of the Office of Internal Audit. Debra was chosen from a pool of three qualified candidates selected by the City's independent Accountability in Government Oversight Committee. Debra recently returned to the Office of Internal Audit as Audit Manager in January 2013. Debra previously served as Director from 1996 through 2004. Congratulations, Debra!
The City of Albuquerque can realize annual cost savings of $273,000, annual cost recoveries of $240,000 and continue the proactive approach to reduce the costs of telecom operations through the implementation of innovative technologies. The City lacks internal controls to ensure the accuracy, efficiency and optimization of telecom services. The overall lack of internal controls is a major factor for the accumulated balance of $1.3 million in the City’s Communication Fund as of June 30, 2013 (unaudited). The fund balance represents the amount departments have been overcharged for communication services.
The Solid Waste Management Department has opportunities for improving its system of internal controls. Such controls are vital to ensuring accountability, consistent operations and integrity of information assets. By implementing the recommendations in this report, SWMD can improve its system of internal controls as it continues to improve delivery of premier residential solid waste collections services to the City of Albuquerque.
Generally Accepted Government Auditing Standards (GAGAS) issued by the Comptroller General of the United States Government Accountability Office require audit organizations to have an external peer review at least once every three years. The City of Albuquerque Office of Internal Audit (OIA) passed its triennial peer review on October 11, 2013, with the highest possible rating.
The Albuquerque Police Department must improve its ability to collect and analyze overtime data associated with DWI cases. By capturing data, APD will be able to quantify and substantiate the impacts that external factors and inefficiencies, such as Metro Court scheduling, have on the Department. This data is an important element that will provide valuable information through which the department can manage overtime and affect change, such as reducing the number of DWI cases dismissed for officer FTA, and decreasing DWI overtime court costs.
Parks & Recreation Department (PRD) Park Management can improve upon the valuable services it provides to the citizens of Albuquerque. The Department’s recognition that change can only happen through active engagement and participation is a crucial step which will lead to the furthered success of the Department. By accepting and implementing the recommendations listed in the audit report, PRD will position itself toward becoming a proactive, organized, successful division within the City of Albuquerque.
01-28-15 - 15-103 - Performance Audit - Traffic Engineering Division Capital Implementation Program Payroll and Staffing - Department of Municipal Development
The Traffic Engineering Division should implement an electronic work order system for the Management section, and should start requiring employees to indicate on the Management and Operations work orders whether the work performed is Capital Implementation Program (CIP) projects or repair and maintenance (R&M). The Traffic Engineering Division should record payroll expense to the CIP fund and GF based on the type of work performed.
The Citizens' Independent Salary Commission studied the roles of the Mayor and City Councilors, sought input from the public, and studied like-size municipalities. After careful study and a transparent review process, the Commission has determined increases in salaries for the Mayor and City Councilors.
02-25-15 - 15-102 - Performance Audit - Albuquerque Convention Center Renovation – Phase II Change Orders
The Department of Municipal Development (DMD) should be aware of and abide by contractual requirements, should perform an independent review of change orders and change order requests, and formally document City approval when change order work is authorized to begin. By addressing these items, DMD will improve project management and may help to identify additional cost savings in future projects. Strengthening and clarifying the contractual language regarding the consultant’s review of change orders will assist and benefit the City by increasing the level of confidence placed on the consultant in the future.
05-05-15 – 14-107 – Special Audit – TASER International Body-Worn Camera Procurements – Albuquerque Police Department
The City has an opportunity to strengthen its controls over procurements and educate both City employees and vendors on the City’s purchasing and conflict of interest regulations. Educating employees and vendors should increase awareness and compliance with City regulations.
06-24-15 - 15-106 - Special Audit - Purchase and Tracking of Ammunition - Albuquerque Police Department
Formal policies and procedures pertaining to APD’s ammunition inventory are needed. Although APD has an extensive supply of ammunition, it has not established and implemented department-wide policies and procedures for purchasing, tracking, and managing ammunition inventory. Tracking the acquisition, storage, and distribution of inventory is critical to controlling cost, operational efficiency, and mission readiness. APD should reduce the number of locations with ammunition inventory to limit risk and increase accuracy of inventory tracking.
The City has increased its use of staffing agency employees by 72.5 percent over the past five years, however, there is not one City department that has overall responsibility of monitoring and managing the use of this service. Each department is responsible for managing its own use, which has contributed to inconsistencies and violations of the contracts, request for bid (RFB) terms, and policies and procedures (P&P). The City has designed and implemented internal controls over obtaining, using, and managing staffing agency employees. However, these internal controls, which are detailed in the vendor contracts, RFB documentation, and P&P, are not consistently distributed and communicated to the department personnel in charge of obtaining, using, and managing staffing agency employees. This has caused many departments to be unaware of rules, regulations, and P&P regarding staffing agency employees, and consequently, has been the root cause of the exceptions. The current contracts the City has for staffing agency employee services are overdue to be rebid. The City can ensure that it is paying the most competitive prices, and offering departments the best staffing agency employee services by rebidding these contracts.
10-28-15 - 14-104 - Performance Audit - Common Cash Bank Reconciliations - Department of Finance and Administrative Services
DFAS should dedicate the additional resources needed to accomplish accurate and timely reconciliations. Accurate and timely bank account reconciliations are essential internal controls to ensure that cash records are complete and accurate, and that data entry errors, bank errors, and potential fraud are detected and resolved in a timely manner. DFAS must first develop a complete understanding of the processes and activities that affect Common Cash. Once the department fully understands how various transactions affect Common Cash, it can implement business process improvements to resolve the complex account structure. Process improvements should also ensure general ledger data is sufficient to facilitate the matching of book transactions to bank statement activity. Gaining a full understanding of all cash transactions, revising business processes, completing the revised monthly book-to-bank Common Cash reconciliation, and resolving reconciling differences will enable DFAS to improve internal control over Common Cash, address the deficiencies noted by the external auditors, and eliminate CAFR audit finding 08-16.
10-28-15 - 15-110 - Performance Audit - Citywide – Staffing Agency Vendor Contract Compliance - Adecco
Between FY 2010 and FY 2015, the City paid Adecco approximately $23.3 million to provide temporary staffing agency employees to help supplement the City’s workforce. As part of the contract, Adecco is required to comply with the terms that are detailed in the contract and RFB. However, based on the testing and review results of this audit there are several areas where Adecco is not following the contract and RFB terms. Adecco is not ensuring that the information on the invoices and periodic reports is always accurate. This has led to incorrect costs on invoices, and estimated over billings of $38,540. In addition, by not ensuring information on invoices and reports is accurate, Adecco hinders the City’s ability to perform proper reviews of the information. Adecco is not ensuring that approved request forms are received each time the City needs to obtain a staffing agency employee. This is a requirement that staffing agency vendors must follow when supplying staffing agency employees. Without verifying that appropriate City personnel have approved the acquisition of these employees it could cause unapproved costs to be incurred, and may ultimately require Adecco to refund the City for the unapproved costs. Finally, Adecco is not pulling staffing agency employees from positions after they have been at the City for more than two consecutive years. Adecco is also not making sure that employees who have worked at the City in any capacity for more than two consecutive years take at least a 90-day break before placing them at the City again. This could cause a potential liability for the City if staffing agency employees, who have been used at the City for a continuous two-year period, feel that they are due permanent City employee benefits. It is imperative that Adecco ensure all contract and RFB terms are being complied with, and that all information sent to the City is accurate and complete.
10-28-15 - 15-110 - Performance Audit - Citywide – Staffing Agency Vendor Contract Compliance - Select Staffing
Between FY 2010 and FY 2015, the City paid Select Staffing approximately $29.5 million to provide temporary staffing agency employees to help supplement the City’s workforce. As part of the contract, Select Staffing is required to comply with the terms that are detailed in the contract and RFB. However, based on the testing and review results of this audit there are several areas where Select Staffing is not following the contract and RFB terms. Select Staffing is not ensuring that the information on the invoices and periodic reports is always accurate, which has led to incorrect billing rates being listed. In addition, by not ensuring information on invoices and reports is accurate, Select Staffing hinders the City’s ability to perform proper reviews of the information. Select Staffing is also not ensuring that approved request forms are maintained for every staffing agency position filled at the City. By not maintaining these records Select Staffing could cause unapproved costs to be incurred, which may not be paid by the City when staffing agency employees are not properly approved before working. In addition, Select Staffing is not ensuring that the staffing agency employees they send to fill City positions have the proper qualifications for the job duties. This could potentially cause a liability for the City if staffing agency employees perform job duties they do not have the proper training for. Finally, Select Staffing is not pulling staffing agency employees from positions after they have been at the City for more than two consecutive years. This could cause a potential liability for the City if staffing agency employees, who have been used at the City for a continuous two-year period, feel that they are due permanent City employee benefits. It is imperative that Select Staffing ensure all contract and RFB terms are being complied with, and that all information sent to the City is accurate and complete.
Numerous contract requirements, which were not met by B&D, remained unnoticed by the City’s user departments. As a result, the City was overcharged on some invoices, cost estimates were not consistently obtained prior to the performance of services, subcontractors performed work on City facilities without City approval, important information was not provided consistently or maintained by user departments, and the City’s risk was not properly mitigated for large projects. Additionally, formal authorization to start work was not provided to B&D timely by City departments. DFAS-Purchasing and DMD should work together to provide information needed by City user departments to increase compliance with contract terms.
Numerous contract requirements were not met by B&D. As a result, the City was overcharged on some invoices, formal authorization to start work was not obtained by B&D, cost estimates were not provided prior to the performance of services, and subcontractors performed work on City facilities without City approval. B&D and the City should work together to increase compliance with contract terms.
DTI should take additional steps to increase security on networked printer/copiers and other multifunction devices. DTI should also take steps to increase awareness of information technology security policies and specific risks posed by networked printer/copiers. Enhancements should be made to processes for departmental purchasing, leasing, and maintenance of printer/copiers. Going forward, printer/copiers should not be connected to the network unless accompanied by a DTI Service Now request. All devices on the network should be documented in a master list, which identifies any devices with hard drives. Procedures should be enhanced to ensure that hard drives on leased printer/copiers are properly erased before being sent back to the vendor or being replaced.
The citizens of Albuquerque have an opportunity to increase the City’s recycling revenue and reduce expenses by increasing the overall weight of recycled commodities, focusing recycling efforts on those commodities that have higher index pricing and reducing the amount of residual/contaminated materials placed in recycling bins. The City’s recycling program and contract with Friedman have been successful. Since 2011, more than 91,000 tons (over 182 million pounds) of recyclable materials have been diverted from the landfill and delivered to Friedman to be recycled. Without the recycling program of today, those materials would be taking up space in the landfill, increasing the City’s disposal costs, and increasing greenhouse gas emissions. By continuing to educate and increase participation in the recycling program, the City, through its contract with Friedman, may further reap the benefits of recycling such as saving energy and resources.
The recently appointed Clerk has an opportunity to improve the Clerk’s Office’s performance by revising the department’s policies and procedures to ensure all regulatory requirements will be met. Additionally, the updated policies and procedures will be available for succession planning, training and to ease through transitions when there is turnover in critical positions. The Clerk also should develop a directive to assist City departments in determining which types of records should be retained at the department level and which types of records should be maintained at the Records Center. The Clerk should then communicate the directive Citywide to ensure compliance with NMAC General Records Retention and Disposition Schedules, facilitate IPRA compliance, and reduce the volume of records submitted to the Clerk.
B&Y overcharged the City a calculated $13,692 on the invoices for services during the 18-month audit period. Invoicing errors were difficult to detect because B&Y did not include all the required information and itemization on its invoices. In addition, B&Y did not consistently record all the information required by the New Mexico Department of Agriculture.
Although the City no longer has a contract with B&Y, the lessons learned from this audit will benefit the City with future contract compliance. City departments also need to be educated about contractual compliance by vendors and ensuring that only appropriate charges are authorized and paid by the City. In addition, allegations by user departments involving potential vendor fraud should be researched immediately, and referred to the City’s Office of Inspector General.
By taking additional steps to reduce instances of inaccurate and outdated content, quality control will be improved, and the City will have greater assurance that citizens, ABQ311, and other website visitors will obtain timely and accurate information when visiting the City’s website.
Mr. Gutowski has worked for the City for more than 15 years. He previously worked for OIA as the Senior Information Systems Auditor and as the Audit Manager, and most recently as the City’s Risk Finance Manager. He graduated from the University of New Mexico Anderson School of Management with a BBA with a concentration in Accounting. Alan is a CPA licensed in New Mexico, CISA, CITP, ITIL F v3, CFE, CIA, CSSGB, and ARM.
Of the ten recommendations addressed in AWD’s Fiscal Management audit report, two have been fully implemented, six are in process and two have not been implemented.
The City of Albuquerque has taken steps toward resolving the unidentified operating fund balance outlined in CAFR finding #06-16. To resolve the finding, a comprehensive written corrective action plan must be created and be supported by the City’s Administration. Prioritizing the resolution of the unidentified operating grants fund balance by creating a comprehensive corrective action plan and holding grantee departments accountable will help to expedite the process. The City needs to dedicate resources to fully implement the grants management module, which will greatly enhance the City’s ability to prevent future unidentified fund balances. Establishing formal internal controls, written policies and procedures, regular training sessions, and reviewing the structure for the fiscal operation of grants will provide future assurance that the operating grants fund balance will remain complete and accurate.
The City has designed and implemented strong controls over the P-Card program. However, there has been a breakdown of the operation and monitoring of those controls, which has caused a breakdown in compliance with rules, regulations, and P&P over P-Cards. It is important that the City take steps to correct issues and ensure the P-Card program is operating as intended.
Inspection of Public Records Act (IPRA) requests have a significant impact on the City. The City needs to identify cost effective solutions to process IPRA requests.
The Annual Report illustrates how the Office of Internal Audit (OIA) achieved its goals in FY2014 and added value to the City through audits and non-audit services. The report also provides background on the talented staff and their qualifications to serve the City in this capacity.
10-26-2016- 15-109 - Performance Audit - Administrative Maintenance of Vacation and Sick Leave - Citywide
By taking steps to align City Regulations with process, and implementing internal controls that will monitor vacation and sick leave changes in PeopleSoft, the City can increase the assurance that all employees are receiving correctly calculated and applied benefits. Clarifying the City’s position related to providing benefits that do not currently fall under Ordinance, AIs or CBAs will ensure the City applies those benefits consistently to all eligible employees.
Effective contract monitoring is an important aspect to ensure contractual compliance. Through effective monitoring of contract requirements and personnel certifications, Advantage Barricade will help to ensure complete compliance with its City contract.
Effective contract monitoring is important for ensuring contractual compliance. City user departments need to be educated about what effective contract monitoring involves, and be reminded that when using citywide contracts, monitoring of these contracts should also be completed. To ensure compliance, user departments should become familiar with and enforce specific contract requirements.
10-26-2016 - 17-302 - Strategic Review - Albuquerque International Sunport Terminal Restroom Remodel & Change Order No. 1
Change orders to construction contracts are not uncommon. Since 2013, change orders for the Aviation Department’s construction projects, increased the average total project cost by 4.4 percent. Change order No. 1 of the AIS Terminal Restroom Remodeling Project exceeded the average and was an 82 percent increase of the original project value.
In an effort to gather information, OIA contacted the Office of the Mayor. Following this request, it was determined that, for at least the past 15 years, no one had been in charge of overseeing the process or preparing and submitting quarterly reports. The Director of the Office of Diversity has agreed to take over this task and will report according to §5-6 ROA 1994.
The Office of Internal Audit (OIA) passed its peer review on October 20, 2016. Government Auditing Standards (GAS) issued by the Comptroller General of the United States Government Accountability Office requires audit organizations to have an external peer review at least once every three years. The external peer review determines whether the reviewed organization's internal quality control system is adequate and whether quality control policies and procedures are being complied with to provided the audit organization with reasonable assurance of conforming with applicable professional standards.
No exceptions were noted for the procedures above. All petty cash funds were accounted for at fiscal year-end, and subsequently deposited in the SID’s main checking account.
Consistently following SOPs and protocol for overtime transactions are significant controls that are intended to prevent unauthorized overtime from being approved and paid. Reconciliation of subsidiary systems to main systems and on-going monitoring can effectively detect potential fraud, waste, and abuse.
Ensuring the accuracy and approval of financial reports and expense information will enhance APD’s assurance that financial transactions are appropriate and authorized.